Politicians rarely admit mistakes, but Mikhail Sergeyevich Gorbachev always was in a different class. So it is not surprising that, as he looked back on his six tumultuous years in power at the head of the Soviet Union, he was willing to count the errors he had made.

In an exclusive interview with the Guardian he named at least five. They led not just to his own downfall 20 years ago; they also brought the collapse of the Soviet Union and the introduction of an unregulated economic free-for-all that turned a few Russians into billionaires while plunging millions of people into poverty.

Gorbachev cuts a relaxed, even cheerful figure these days, but there are still the occasional twinges of bitterness, particularly when discussing his arch-rival Boris Yeltsin, or when he described the plotters who put him under house arrest in the Crimea during their abortive coup 20 years ago .

"They wanted to provoke me into a fight and even a shootout and that could have resulted in my death," he said.

Asked to name the things he most regretted, he replied without hesitation: "The fact that I went on too long in trying to reform the Communist party." He should have resigned in April 1991, he said, and formed a democratic party of reform since the Communists were putting the brakes on all the necessary changes.

This judgement will be of particular interest to historians since it is Gorbachev's first public admission that he should have left the Communist party several months before the coup of August 1991. In the memoirs he published in 1995 he did not go so far.

By the spring of 1991 Gorbachev was caught between two powerful trends which were narrowing his room for manoeuvre. On one side conservatives and reactionaries in the party were trying to reverse his policies; on the other were progressives who wanted to establish a full multi-party system and take the country towards market reforms.

Things came to a head at a session of the Communist party's central committee in April 1991. At a Communist party central committee meeting, several speakers called for the declaration of a state of emergency and the re-imposition of censorship. According to his memoirs, Gorbachev reacted sharply: "I've had enough of demagoguery. I am resigning."

In his Guardian interview, he explained what happened in detail: "The Politburo [the top decision-making body within the central committee] went into a meeting and sat for three hours without me. I was told they criticised me and the discussion ran loose. Three hours later they invited me back and asked me to withdraw my resignation. During that time my supporters in the central committee had opened a list and more than a hundred people put their names behind the idea of creating a new party."

When the central committee resumed its session, tempers had cooled, Gorbachev withdrew his resignation and no one wanted the issue put to a vote. (Even if he had resigned from the party, he would have remained Soviet president). In his memoirs, Gorbachev wrote: "Today I often wonder whether I should have insisted on resigning the post of general secretary. Such a decision might well have been preferable for me personally. But I felt I had no right to 'abandon the party'." The party had ruled Russia since 1917 and it was hard for anyone in Russia, particularly an official who had spent his entire career as a party functionary, to imagine it going out of power.

Today Gorbachev's doubts have gone. "I now think I should have used that occasion to form a new party and should have insisted on resigning from the Communist party. It had become a brake on reforms even though it had launched them. But they all thought the reforms only needed to be cosmetic. They thought that painting the facade was enough, when actually there was still the same old mess inside the building."

His second regret, he said, is that he did not start to reform the Soviet Union and give more power to its 15 republics at an earlier stage. By the time he began to think of creating a looser federation in early 1991 the three Baltic states had already declared independence. Blood had flowed in Lithuania and Azerbaijan in the Caucasus. Under its ambitious leader, Boris Yeltsin, Russia, the largest republic, was flexing its muscles and demanding more control over the Soviet budget. Some analysts say the whole Soviet system was unreformable and any change was bound to lead to an unstoppable process of increasingly dramatic transformation. It was inevitable, according to this analysis, that Gorbachev lost control.

In part because of his generous character, sunny personality, and happy home-life (until his wife Raisa Maximovna died of leukemia in 1999), Gorbachev remains an optimist. Loss has not embittered him or made him cynical. He argues that all the main Soviet problems were on the verge of resolution until the August 1991 coup wrenched the competing forces into a new dynamic.

The Communist party was due to draft a new programme in November 1991. Parliament had adopted an "anti-crisis plan" to accelerate economic reform. The 12 Soviet republics that remained after the Baltics left had accepted the text of a new treaty that would give them more political and economic autonomy while leaving defence and foreign affairs to the Soviet government. The treaty was to be signed on 20 August.

"Here I made a mistake. I went on holiday. I probably could have done without 10 days of vacation … I was all ready to fly to Moscow to sign the treaty," he said. But on 18 August a group of people arrived uninvited. I picked up the phone to ask what kind of people they were and who had sent them, but there was no line. The phone had been cut off."

Gorbachev was with his wife, daughter Irina and her family in a government villa at Foros on the shore of the Black Sea. The buildings were under guard for three days until the coup collapsed because of Yeltsin's resistance, splits in the army, and internal disagreements among the group of around a dozen plotters who were all ministers or senior Communist party officials.

Gorbachev vigorously rejected theories that he had given a green light to the plot. "People claim falsely that Gorbachev still had communications and that he had organised everything. They say Gorbachev thought he would come out the winner, whatever happened. That's nonsense, total nonsense", he said. "These people wanted to unseat the leader and preserve the old system. That's what they wanted. They demanded that I write a statement asking to be released from the duties of the presidency because of ill-health."

Raisa Maximovna kept a diary during their house arrest. In it she reported that Gorbachev warned the guards he would take "extreme measures" if his links to the outside world were not restored.

This was all bluff, Gorbachev told me. "That was part of my manoeuvring … I just wanted to put pressure on them but I wanted to avoid provoking them … My extreme measure was diplomatic and political. I was able to outplay them. If there hadn't been movement in Moscow, my position would have been left hanging in the air. But here in Moscow people were protesting. They were led by Yeltsin and this is why we have to give him due credit and hand it to Yeltsin. He did the right thing".

As one of the Guardian's correspondents in Moscow during the coup, I reminded Gorbachev that Yeltsin's call for a general strike went unheeded and many Russians were in despair, feeling the coup would succeed. The older generation remembered how hardline colleagues had easily removed Khrushchev and brought the era of de-Stalinisation to an end in 1964. I asked Gorbachev what would have happened if the plotters had arrested Yeltsin as well as Gorbachev at the beginning. Could they have won?

The former Soviet leader said hypothetical questions were of little value. The balance of forces was such that the coup was doomed whatever the plotters did. The coup plotters were in confusion because of his resistance and refusal to resign the presidency. He also pointed out that special forces mutinied when ordered to storm the White House where Yeltsin was surrounded by thousands of supporters.

Gorbachev listed several achievements he was most proud of, starting with one word: "Perestroika."

Meaning restructuring, perestroika was the programme of reforming the Soviet Union's political and economic system that Gorbachev set in motion soon after he came to power in March 1985. But it also involved the restructuring of international relations based on nuclear disarmament, the rejection of forcible intervention abroad and a recognition that even superpowers lived in an interdependent world. No country was an island or should act unilaterally.

The new Soviet policy of non-intervention allowed the eastern European states to produce internal regime change by peaceful means. "What we were able to achieve within the country and in the international arena was of enormous importance. It predetermined the course of events in ending the cold war, moving toward a new world order and, in spite of everything, producing gradual movement away from a totalitarian state to a democracy."

Gorbachev has never reconciled himself to Yeltsin's nine years in power which he sees as a time of chaos. Nor to Yeltsin's pact with the leaders of Ukraine and Belarus to declare the Soviet Union dead in December 1991. He should have got Yeltsin out of the way several years before he became a direct rival. "I was probably too liberal and democratic as regards Yeltsin. I should have sent him as ambassador to Great Britain or maybe a former British colony," he said.

He praises Putin for initially restoring stability until about 2006. Even though he used some authoritarian methods, that was acceptable in Gorbachev's view. "But then came the moment when I saw him changing the election system, abolishing elections for governors of Russia's regions and getting rid of the single-member constituencies. I counted 20 changes that I couldn't support," he added.

As the hour-long interview neared its end, I asked the former Soviet president about change in China, the world's largest Communist state. Gorbachev takes the long view of history but is sure reform there is inevitable. Any suggestion that he should have followed China by starting with economic rather than political reform is wrong, he says.

"In the Soviet Union nothing would have happened if we had done that. The people were cut out, totally isolated from decision-making. Our country was at a different stage of development from China and for us to solve problems we had to involve people."

"Do you think the Chinese will be able to avoid the same hard choices at some point in time? There will be a moment when they will have to decide on political change and they are already nearing that point."

In March this year, Gorbachev celebrated his 80th birthday in London at a gala evening in the Royal Albert Hall, hosted by Kevin Spacey and Sharon Stone. An eccentric array of singers performed for him, including Shirley Bassey, Paul Anka, Melanie C as well as the German rock band the Scorpions, who were the second western group to play in the Soviet Union.

But the highlight was a performance on a large screen of Gorbachev singing a Russian love song. The audience was stunned by the clarity as well as the passion of his voice. I told him I didn't know he could sing so beautifully, and had this hidden talent.

He laughed. " If necessary I'll become a pop singer," he said. "Raisa liked it when I sang."